When your customers aren’t returning and your profits are going down, it is frustrating and costly. However, you can be sure that there are reasons for it, and there are fixes that can be applied to your business. First, you will need to take a critical assessment of your company to see what should be done to make improvements. You can start with these top five reasons why businesses lose customers to competitors and learn how to prevent each from causing further damage to your business.
1. Subpar Quality in Goods or Services
When your product falls apart after little use or your services leave much to be desired, there is no magic marketing fix that will help your sales. If customers are disappointed with your product or service, they will leave online reviews warning other potential customers of their experience. According to Oberlo, 85% of people conduct online research before making a purchase online. The ability to read reviews and learn about others’ outcomes has a huge impact on customers’ decision-making process.
What to do: Cut fewer corners. Use quality materials in your product design that will hold up with use. Consult with a product designer to make improvements to your product that are within your bottom line. For services, pay close attention to your customer feedback and make the appropriate adjustments.
2. Poor Customer Service
Creating customer loyalty within a brand is an important measure to help retain business. In some businesses, customer service is even more important than the quality of goods or services. Customer service is a large part of the customer experience that drives them to either keep coming back or switch to a competitor. A negative customer service experience can stem from customers not feeling appreciated, not being able to speak with a representative who can answer their questions, experiencing rude behavior from employees, and being passed from one employee to the next without receiving resolution for their issues. About 49% of people stopped doing business with a company in 2019 due to poor customer service.
What to do: Review your company policies to see what internal issues can be fixed. Create employee incentive programs that reward excellent customer service and behavior. Always make sure your employees have all the resources they need to fully serve the customer. When mistakes are made, be sure to acknowledge them with the customer and remedy their particular situation quickly. And, when hiring new employees, don’t cut corners to find fast replacements. Take the time needed to conduct background checks, check references, and properly train your new hires.
3. Long Wait Times
Some businesses often gather long lines, leave customers sitting in waiting rooms for long periods, or place them on hold for what seems like hours at a time. These situations breed customer dissatisfaction and irritation that can easily cause them to walk out the door or take their business elsewhere. While you may see a full waiting room as a good sign that you’re keeping busy, you may be losing customers to the competition. Unhappy customers who were forced to wait will leave bad online reviews that can taint your company’s reputation.
What to do: In the past, businesses had few choices beyond physical queues and the take-a-number system. But today, modern technologies make it possible for customers to wait anywhere while they receive wait time notifications or callbacks on their cell phones. One telecommunications company estimated that out of all of their walkaways, only one-third returned. By utilizing a queue management and appointment scheduling app, their stores experienced a 66% reduction in service delays with customers.
4. Failure to Price Correctly and Demonstrate Value
Contrary to popular belief, customers don’t only choose the lowest price on products and services they can find. Price and value are strongly connected. Price reflects what they pay for something, while value is what they receive. Value includes quality, life of a product, and performance of a service. Conveying your product’s value is an important marketing strategy that helps build customer trust.
What to do: When creating marketing strategies, emphasize what is unique and different about your product or service that makes it better than the competitors’. Showcase this information on all of your marketing platforms, and be sure your staff relays it to customers. Use real data to help drive your campaigns. Also, don’t drop your prices too low, as this can drive down the perceived value of your product or service. Conduct research on the current fair market price for your items or services.
5. Failure to Adapt And Respond to Customers
The economy is constantly evolving, and so are customers’ expectations. Customer surveys provide an important resource for companies. Customer surveys tell owners what customers expect from their services and goods, determine areas of weakness in their business processes, evaluate how their employees treat customers, and generally identify how to improve to make businesses more appealing and effective. When business owners ignore this important data, they can easily lose out as competitors up their game and improve their own businesses.
What to do: Make sure you have a system for collecting customer feedback. Customers should be able to leave comments on your social media accounts and use a contact form on your company’s website, and you should be sending out customer surveys and satisfaction forms through email or via text messages. And of course, review the results and make appropriate changes within your business.
The most important thing to remember is to not get stuck in the same old approaches. When things don’t work, move on and try something new. Do your research, consult with experts, and don’t get discouraged when you hit setbacks.
About the Author: Katie Tejada is a writer, editor, reporting manager and former HR professional. She often covers developments in HR, business communication, marketing and customer service, but also enjoys writing about events, travel, decorating trends, real estate and finance, among others.